AusQuest Limited announced that it has upgraded the recently identified magnetite potential at its Morrissey Project in Western Australia after receiving highly encouraging results from beneficiation test work (Davis Tube Recovery (DTR)) on magnetite-rich iron formations intersected by earlier Reverse Circulation (RC) drilling. The DTR test work yielded iron (Fe) concentrate values in excess of 70% Fe, a significant result which elevates this project as a significant new opportunity for the Company. Six composite samples (~10m thick) submitted for testing confirmed that the magnetite ironstone intersected at both the Waterfall and Sandfly prospects can be beneficiated using simple magnetic separation to produce a high-grade iron concentrate (+70% Fe) at a relatively coarse grind size (95% passing 75 microns).

At Waterfall, four composite samples from 102m to 144m down-hole (MYRC001) yielded 42 metres at an average DTR recovery of 40.8% and a concentrate grade of 71.3% Fe, 1.4% SiO2 and 0.08% Al2O3 whilst at Sandfly, two composite samples from 82m to 100m (MYRC002) yielded 18 metres at an average DTR recovery of 41.5% and a concentrate grade of 71.3% Fe, 0.8% SiO2 and 0.29% Al2O3. No deleterious element concentrations were recorded in any of the six samples submitted. The initial RC drilling program (three holes) was designed to test for base metal mineralisation but discovered magnetite iron formations at both the Waterfall and Sandfly prospects.

A significant untested strike length is apparent at both prospects, with multiple untested targets evident in the regional magnetic data that are now considered priority targets for additional magnetite mineralisation. Specific gravity measurements on RC drill samples indicated a high density (SG 3.4) for the magnetite mineralisation, suggesting that it should produce distinct gravity anomalies enabling magnetic targets to be prioritised ahead of future drilling. The Morrisey Project is located within the Narryer Terrane, approximately 500km north of Perth in WA and is subject to the Strategic Alliance Agreement (SAA) with a wholly-owned subsidiary of South32 Limited (South32).